1.3 ORGANIZATIONAL PLANNING & DECISION MAKING:FISHBONE ANALYSIS HL (HIGHER LEVEL CONTENT)
DECISION MAKING TECHNIQUES(p56-65) There are a number of techniques that may assist managers in making more effective decisions. As a HL student you must know: • The Fishbone (cause & effect) diagram/ • Decision Trees (probability diagrams) • Force Field Analysis
THE FISHBONEOrigins • The fishbone diagram (also know known as the Ishikawa or cause and effect diagram) attempts to identify the causes of an event. • It gets is names from the fact that the diagram resembles the skeleton of a fish. • The diagram was created by Kaoru Ishikawa, who pioneered quality management processes in the Kawasaki shipyards. • He became one of the founding fathers of Japanese modern management.
THE FISHBONEAnalysis • Fishbone analysis provides a structured way to help think through all possible causes of a problem. • Causes in the fishbone diagram are usually arranged into four or six major categories, although this can be adapted to the individual situation.
Categories for the Fishbone The Six Ms: Recommended for Manufacturing Goods • Manpower, Methods, Machinery, Materials, Mother Nature (environment), Measurements Recommended for Delivery Services • Equipment, policies, procedures and people.
Steps in the Process for Using a Fishbone Diagram • Identify and agree on the problem • Establish the major causal factors involved. • Identify possible causes. • Analyze the Diagram
FISHBONE DIAGRAM PROCESS1. Identify and Agree on the Problem • Write down the exact problem • Identify the staff involved, and when and where the problem occurs. • Write the problem on the right hand side of the diagram. • Draw arrow across the paper horizontally to the problem, providing a framework to develop ideas.
FISHBONE DIAGRAM PROCESS2. Establish the major causal factors involved • Identify the factors that may be root causes of the problem and merit further investigation. • Draw lines off the spine for each of the factors and label the branches. • These may include factors such as the people involved with the problem, machinery employed, methods used and materials used. • These factors may be established using a brainstorming exercise.
FISHBONE DIAGRAM PROCESS3. Identify possible causes • Where a cause is complex, there may be several sub-causes. • For each root cause identified ask: why is this cause happening? • Establish possible related sub-causes. • These are them smaller lines off the “bones” of the fish. • The five waves technique (p64) would be useful here.
FISHBONE DIAGRAM PROCESS4. Analyse the Diagram • Investigate the most likely causes identified on the diagram, which may involve further, more extensive and detailed research. • This should help clarify whether the causes are correct.
FISHBONE DIAGRAM – FOLLOWUP • Once the diagram is completed, the business will put into action policies to address the underlying causes of the problem identified. • For an application of the fishbone to the total quality management see p254 (textbook)
FISHBONE EXERCISE Problem A Business is experiencing declining sales of its Product X Identify possible causes of this problem and possible solutions, by completing a fishbone diagram.